Financial Daily from THE HINDU group of publications
Saturday, Oct 02, 2004
Financial Daily from THE HINDU group of publications Saturday, Oct 02, 2004 |
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Money & Banking
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Co-operatives Government - Financial Policy Ordinance issued: Banking licence for Multi-State co-ops Our Bureau
New Delhi , Oct. 1 THE Government has promulgated an Ordinance to amend the Banking Regulation Act, 1949 to enable RBI to issue licences to Multi-State Cooperative Societies to carry on banking business. The Ordinance would also extend the deposit insurance cover to urban cooperative banks registered under the Multi-State Cooperative Societies Act. The Ordinance had been necessitated in view of the Supreme Court judgement of October 2003 in the case of Apex Urban Cooperative Bank of Maharashtra & Goa Ltd. vs Maharashtra State Cooperative Bank Ltd. which had said that RBI cannot issue banking licences to a society registered under the Multi State Cooperative Societies Act (MSCS Act), 1984. In view of the directions of the Court, RBI cancelled the licence issued to Apex Urban Bank on October 30, 2003. There are 34 other Urban Cooperative Banks registered under the MSCS Act, 1984, which have been licensed under the provisions of Banking Regulation Act, 1949. In view of the Supreme Court ruling, doubts have been expressed about the legality of the licences issued to these urban cooperative banks.
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